Maryland officials issue warning on bitcoin, virtual currencies

A man talks on a mobile phone in a shop displaying a bitcoin sign during the opening ceremony of the first bitcoin retail shop in Hong Kong in this February 28, 2014, file photo.

A man talks on a mobile phone in a shop displaying a bitcoin sign during the opening ceremony of the first bitcoin retail shop in Hong Kong in this February 28, 2014, file photo. (PHILIPPE LOPEZ / AFP/Getty Images)

Jamie Smith Hopkins, The Baltimore Sun

State financial regulators and the attorney general issued a warning Friday about bitcoin and other virtual currencies, saying buyers — and sellers — should be careful.

"For now, there is little to no regulation and no safety net for consumers or investors who lose their money dabbling in virtual currency such as Bitcoin," Attorney General Douglas F. Gansler said in a statement.

Mark Kaufman, Maryland's commissioner of financial regulation, said in that statement that the state doesn't regulate virtual currencies but is examining issues related to them.

The state released a consumer advisory that details some risks. Among them: virtual currencies are highly volatile — and can be stolen.

A major bitcoin exchange announced in February that almost 850,000 bitcoins, most belonging to customers, had gone missing. But the currency — which allows users to avoid transaction fees and buy items anonymously — has won enthusiastic support from some corners. Overstock.com is among the businesses accepting payment in bitcoin.